The Sacramento City Unified School District logo at the Serna Center in Sacramento.
JOSÉ LUIS VILLEGAS
jvillegas@sacbee.com
Sacramento City Unified School District revealed in September that it would have a $43 million deficit by summer. As of this week, that estimate has jumped to $108 million despite months of working to reduce spending.
The district will review the second interim budget at a meeting Thursday night.
Earlier this month, the budget services department projected that the district’s fiscal solvency plan for this year, which identified about $63 million in savings, put it halfway toward its goal of addressing the deficit, which stood at $135 million at the time. But new estimates show that the deficit projection should have been closer to $171 million, meaning the district is still $108 million short.
Despite district financial officers still projecting cash solvency through the end of this school year — thereby avoiding state takeover during that time — the district needs to massively reduce spending. The latest multi-year projections show SCUSD having a $390 million deficit by the end of the 2027-28 school year. The district’s total budget is around $800 million.
How did that scary number get four times larger? Interim Chief Business Officer Lisa Grant-Dawson said that it wasn’t a matter of the deficit growing, but of finally identifying the “real number.”
“It’s because you had a $100 million deficit for years, and we’ve not addressed it long term — that’s the real answer,” Grant-Dawson said in an interview Tuesday.
Part of the reason the numbers look so much different between September and now is the financial department’s correction of budgeting errors in the first interim budget. The former budget team double-counted potential savings, and some items originally identified as potential savings were not implemented.
In November, it wasn’t clear to the board, or the public, that cost savings estimated in the draft fiscal solvency plan had already been factored into the first interim budget, especially since the document had yet to be approved by the board.
When Grant-Dawson joined the district in January she questioned several aspects of the plan.
“You do have several items on here that will not yield either what is projected or you are not going to be able to operationalize it to the degree that it states,” Grant-Dawson said at a meeting in January.
The second interim budget removed presumed savings in the former fiscal solvency plan, adding tens of millions back into the deficit.
Another area where spending has gone up is in contracts, despite the district’s stated goal to minimize spending on third party services. The district projects it will spend around $25 million more than expected at the time of the first interim budget review because of increased costs associated with services for special education students.
The Sacramento Bee
Jennah Pendleton is an education reporter for The Sacramento Bee. She previously covered schools and culture in the San Francisco Bay Area. She grew up in Orange County and is a graduate of the University of Oregon.